BILL ANALYSIS
AB 1565
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Date of Hearing: May 6, 2009
ASSEMBLY COMMITTEE ON INSURANCE
Joe Coto, Chair
AB 1565 (Committee on Insurance) - As Amended: April 13, 2009
SUBJECT : Insurance
SUMMARY : Makes technical corrections to laws governing
insurance including correcting references that govern the manner
in which the Insurance Commissioner (IC) may withdraw the
approval of forms for credit life and disability insurance.
Specifically, this bill :
1)Specifies that the following laws apply to the withdrawal of
the approval of forms for credit life and disability insurance
that must be filed or approved by the IC:
a) Permits the IC to withdraw approval of filing of any
policy when the IC would be authorized to disapprove or
refuse filing of the policy if originally submitted at the
time of the action of the withdrawal.
b) Specifies that no proceeding in Section 10291.5 of the
Insurance Code, established to prevent fraud and unfair
trade practices in connection with disability insurance, is
subject to administrative adjudication and formal hearings.
2)Specifies, in connection with surplus line brokers, that the
California Department of Insurance (CDI) is authorized to
collect additional license fees resulting from the increases
in licensee fees provided by Chapter 29 of the Statutes of
2008 and shall credit any overpayment resulting from
reductions in license fees provided by that act.
EXISTING LAW :
1)Specifies that the following laws apply to the withdrawal of
the approval of forms for credit life and disability insurance
that must be filed or approved by the IC:
a) Provides that a section of law (Section 10291.5 of the
Insurance Code) does not authorize the Insurance
Commissioner (IC) to establish or require a single or
standard application form for application questions in
AB 1565
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connection with disability insurance.
b) Authorizes the IC to promulgate rules and regulations,
after notice and hearing, to establish the standards by
which he or she will disapprove or withdraw approval of any
disability policy.
2)Specifies, in connection with surplus line brokers, that the
CDI is authorized to collect additional license fees resulting
from the increases in licensee fees provided by the act that
added this law and shall credit any overpayments resulting
from reductions in license fees provided by that act.
FISCAL EFFECT : None.
COMMENTS :
1)Committee bill. This is a bill authored by the Members of the
Insurance Committee.
2)Summary of bill contents. This bill makes technical
corrections to the Insurance Code. The bill corrects
references in existing law that govern the manner in which the
Insurance Commissioner may withdraw of the approval of forms
for credit life and disability insurance. The bill clarifies
that the IC may withdraw approval of policies in the same
manner as if the policy was being originally submitted for
approval, and clarifies that the withdrawal of approval
process does not require administrative adjudication and
formal hearings. The bill also corrects spelling errors and
identifies the statute that authorizes the IC, in connection
with surplus line brokers, to collect additional license fees
and credit any overpayments.
REGISTERED SUPPORT / OPPOSITION :
Support
None received.
Opposition
None received.
AB 1565
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Analysis Prepared by : Manny Hernandez / INS. / (916) 319-2086